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Unemployment Rate Hits Five-Month Low

WASHINGTON - The Labor Department said on Friday that the U.S. unemployment rate dropped to a five-month low in August as employers stepped up their recruitment efforts. Job gains in services, government, and construction were largely offset by losses in manufacturing and retail trade.

September 5, 2002, 08:00 pm

WASHINGTON - The Labor Department said on Friday that the U.S. unemployment rate dropped to a five-month low in August as employers stepped up their recruitment efforts. Job gains in services, government, and construction were largely offset by losses in manufacturing and retail trade.

The unemployment rate fell by two-tenths of a percentage point to 5.7 percent, the lowest level since March.

While nonfarm business payrolls grew by 39,000 in August, payrolls in retail trade declined by 55,000, the Labor Department said. The other big loss came from the manufacturing industry, which shed 68,000 jobs last month.

The Labor Department attributed August's increase in payrolls mostly to a surge in services jobs. The services industry added 100,000 jobs, the biggest increase in almost two years. The services-producing industry added 72,000 jobs, down from 108,000 in July. Government agencies added 41,000 jobs, twice the amount in July.

Average hourly earnings rose four cents, or 0.3 percent, to $14.82 in August. Wage growth has slowed in year-on-year terms this year: the increase in August was 3.1 percent, down from a peak of 4.4 percent late last year.

But the average work week increased slightly: In August, the week lasted 34.1 hours, up six minutes from July.